Public counsel calls for full disclosure in billing

Simpler billing methods and policies for past-due bills benefit the public, the counsel says

Missouri Public Counsel Martha S. Hogerty in November 1999 filed comments with the Public Service Commission asking it to adopt rules that require telecommunications companies to disclose to the customer in clear and plain language the services provided and the specific prices.

Hogerty also supported reforms in disconnection policies, so local basic service cannot be disconnected for overdue toll charges.

She asked for a rule so payments are first applied to past due local charges in order to keep the customer connected to phone service, according to a release from the Office of the Public Counsel.

Hogerty cautioned the PSC that the reduction or elimination of certain regulatory controls of company prices and profits should not trigger a reduction in consumer protection policies and programs.

"It is just as important for the PSC to protect vulnerable consumers from unfair and deceptive practices as it is to prevent the dominance of one or more market players over other competitors," Hogerty said in the release.

The public counsel also said the rules must mandate that companies provide consumers with meaningful information that will allow them to participate in and benefit from emerging competition.

The information provided to customers can be overwhelming, confusing, incomplete, and out right false or misleading which can frustrate and deny consumers the benefits expected from competition, Hogerty said.

For the market system to work properly, customers must know their rights and be provided with price and service quality disclosures that allow them to compare offerings and avoid being charged for services they did not order, Hogerty said.

She also suggested other rules to protect telephone consumers, such as broader rights to privacy; written notices of the prices, terms and conditions of newly purchased services; and notice of any changes in services or in telecommunications providers to combat slamming and cramming of unauthorized services.

The PSC received comments on proposed rules for telecommunications service and billing practices from the industry and Public Counsel Nov. 12 and held a public hearing on the rules Nov. 15.

Highlights of the public counsel's comments included:

Truth in billing reforms

Bills should be organized to be readable and to present important information clearly and conspicuously. Local, toll and nontelecommunications services should be separately listed.

Charges should be itemized so customers can see separate charges for all services including basic service, all calling plans, features, toll and other services.

"Miscellaneous" charges should be banned.

Meaningful disclosure of the price per minute for toll calls, billing increments, the discounts and the minimum usage needed to obtain the discounts, and the stand-alone price of services bundled together so the customer can see if the bundled price is advantageous.

Billing agents should not appear on the bill; rather, only the name of the company providing the service with its toll-free number.

Changes to service should appear in a separate section and be conspicuously marked.

Costs passed through for access and universal service support should be accurately described instead of mislabeled as federally mandated charges.

Disconnection practices

Customers cannot be disconnected from local basic service for nonpayment of toll charges.

Payments must first be applied to overdue local service, then current local, then toll, then other services.

Disconnection notices for local service can only list the amount owed for local service and cannot state the entire unpaid amount for other services.

Deposits and toll blocking

Companies should only require deposits, guarantees or toll blocking as a condition of service based only on the customer's telephone credit history and not on general creditworthiness.

Other issues

The public counsel also recommended:

That the PSC adopt a rule prohibiting cramming, the unauthorized charge for a service for which the customer did not make an affirmative order.

Customers should receive a "Terms of Service" notice for any new service order or service change that itemizes services, the charges, material terms and conditions, and cancellation rights. This would help customers identify cramming.

New privacy protections should be enacted to prevent unauthorized use of customer information and records, such as payment and calling practices. Customers with unlisted numbers should be allowed to automatically block transmission of their numbers to Caller ID.

A company that proposes a service that affects privacy must file a statement of its potential impact on the customer and what options are available to address privacy concerns.